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The wage increase would jeopardise labour relations, cause a reduction in the agriculture sector work force, and create a "climate for inflation" that would impact on consumers, it said in a statement.

Earlier, Oliphant announced a new minimum wage of R105 a day for farm workers, up from the current R69 a day, to take effect from March 1 this year.

Oliphant said all parties on the Employment Conditions Commission had agreed to the new minimum wage except the business representatives.

ECC commissioner Ingrid Woollard said business had argued for a lower figure, but declined to give the amount it had proposed.

Transvaal Agricultural Union (TAU SA) said the increase was the result of "undue pressure and intimidation by seasonal workers", adding that this created "a precedent for future actions in other sectors".

This would jeopardise labour relations.

"Secondly, small and emerging farmers in particular, certainly cannot afford these wages. Even concerns in certain industries will not be able to pay these wages... They will have no other choice but to reduce their workforce for the sake of financial survival."

With its announcement, government was aiding the creation of a climate for inflation "by approving several increases which will ultimately have a negative effect on consumers".

The statement quotes TAU SA president Louis Meintjes, who said organised agriculture's "motivated proposal of R80 per day... was totally ignored".

He also warned that further unrest could occur if farmers were to implement wage increases only at the new minimum wage level.

"Other workers will be most unhappy if their fellow workers received a substantive salary increase which did not apply to those already receiving wages in excess of the minimum wage.

"Farmers will therefore have to implement an increase applicable to all pay scales which makes the situation much more difficult.

"With such increases, farmers will have no option but to invest in mechanisation, which will minimise the impact of further increases and labour unrest," Meintjes said.

In the recent protests in parts of the Western Cape, farm workers have been demanding a R150 a day minimum wage.

The Congress of SA Tade Unions (Cosatu) welcomed the wage agreement, but said it would not signal the end of efforts to improve the plight of farmworkers.

"Cosatu welcomes this agreement, but it is not enough," said Cosatu Western Cape secretary Tony Ehrenreich.

He said the agriculture sector as a whole should be transformed to improve relations on farms, and between farmers and the state.

"There is an attitude of hostility between farmers and their workers, and to some extent between government and farmers."

Ehrenreich accused the farmers of not coming to the table sooner, and criticised them for offering R94 a day when they did.

"Workers have realised that they are not going to get anything for nothing," he said of the strikes that brought farming activity to a standstill in fruit-growing regions of the province in recent months.

Oliphant said an exemption from the new minimum wage would be available to farmers who could provide proof that their financial situation was so poor they would be forced to shut down operations if their wage bill rose accordingly.

The minister also called for better labour relations in agriculture.

"Agriculture is an important sector in our economy and it is imperative that it is stable at all times," she said.

The Freedom Front Plus warned that the new minimum wage would lead to job losses.

FF Plus leader Pieter Mulder, who also servers as Deputy Agriculture Minister, said the choice in South Africa was often between minimum wages or no work at all.

"It should be expected that South Africa's agriculture will in the next couple of years undergo a total restructuring, where farmers will be changing to less labour-intensive products, or will mechanise in an effort to balance their books."

The new minimum wage would also lead to the dismissal of seasonal workers.

"Where permanent workers will not be affected so much by the new wage determination, it will lead to the dismissal of tens of thousands of seasonal and temporary workers," Mulder said.

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